What happens when Xcel pulls the plug in 2019? - KCBD NewsChannel 11 Lubbock

What happens when Xcel pulls the plug in 2019?

By James Clark - email

LUBBOCK, TX (KCBD) - Some interpret the ancient Mayan calendar as saying the world will end in 2012.  For Lubbock electric customers the date to cause worry & fear might be closer to March 31, 2019.  That's when Xcel Energy will, for the most part, stop selling wholesale power in the greater Lubbock area. 

Xcel Says No Thanks

If one were to ask Lubbock's Electric Utility Board Chairman, W.R. Collier, "What happens in 2019?" he would immediately recognize the question and his answer would be "our contract for wholesale power expires."

Will Xcel negotiate a new contract for Lubbock Power & Light?  "They won't do it," Collier says. 

"We are not currently negotiating any new contracts [for wholesale power]," says Xcel spokesman Wes Reeves. 

"If it's not on the books now it won't be added," Reeves says.

LP&L actually does have a portion of its needs already on the books with Xcel for after 2019. 

Collier says, "They gave us a contract that expires in 2045 for 170 megawatts."  That's enough power to meet the needs of customers who were switched to LP&L in the recent buyout of Xcel's Lubbock assets.  Beyond that, Xcel is pulling the plug.

Finding New Partners

LP&L is now turning to its partners, the West Texas Municipal Power Agency.  WTMPA is comprised of Lubbock, Floydada, Tulia and Brownfield.  The four towns together anticipate an unmet need of 372 megawatts in 2019, which accounts for the 170 mw of Xcel power plus 220 mw from power plants LP&L owns in Lubbock. 

So will WTMPA build or buy a new power plant?

"If you're gonna build one you better get started.  If you're gonna buy one, well they don't come on the market every day," Collier says.

WTMPA created a separate agency called High Plains Diversified Energy Corporation which is working on buying two natural gas plants in the Odessa area for roughly $520 million.  HPDEC has been praised for negotiating a deal to get power plants for "roughly 40 cents on the dollar," according to sources.  But HPDEC is criticized for choosing power plants roughly 150 miles away from Lubbock.  The cost of running transmission lines can run $1 million per mile. 

HPDEC has also been criticized for allegations of conflict of interest and not opening its records for public inspection.

SPEC Also Looking For Power

South Plains Electric Co-op, with 11,000 meters inside the City of Lubbock, is not immune to March 31, 2019.

SPEC General Manager James Driver is also the Board Chairman for Golden Spread Electric Cooperative.  Driver says, "We're [Golden Spread] out building plants to meet our needs and finding other resources." 

Driver says, "We're building a plant now in Abernathy at the TUCO interchange."  The plant will supplement wind power in those times when the wind goes down. 

So how much will this cost SPEC customers?  "We've got it estimated to be about the same.  It depends on the price of natural gas." 

The Abernathy project is not enough.  Driver says, "We'll need additional capacity and I can't talk about that yet."

The HPDEC deals in Odessa are not finalized yet either.  Should Lubbock be concerned?  Collier says, "Sure, I'm concerned about it.  Anyone who wants electricity should be concerned." 

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